virtual soft virtualsoft systems limited2. the register of members and share transfer books of the...

VIRTUAL SOFTGet The Digital Edge Virtualsoft Systems Limited

BOARD OF DIRECTORS Mr. Gokul Tandan Managing Director Mr. Rajendra V. Kulkarni Whole time Director Mr. Ashok K. Anand Director Mr. Suresh Rajpal Director

COMPANY SECRETARY Mr. Atul Kumar

BANKERS HDFC BANK LIMITED D-965, Opp. Mata Ka Mandir New Friends Colony New Delhi-110 065.

STATUTORY AUDITORS Nath Ahuja & Co. Chartered Accountants S-400, Graater Kailash -II New Delhi-110 048

REGISTERED OFFICE S-101, Panchsheel Park,, New Delhi-110 017

SHARE TRANSFER AGENT Mas Services Pvt. Ltd. AB-4, Safdarjung Enclave New Delhi – 110 029

C o n t e n t s

Notice .............................................................................................................................................................. 1

Directors’ Report ..............................................................................................................................................2

Corporate Governance Report .........................................................................................................................5

Auditors’ Report ..............................................................................................................................................12

Balance Sheet ................................................................................................................................................15

Profit & Loss Account .....................................................................................................................................16

Cash Flow Statement .....................................................................................................................................17

Notes forming part of the Financial Statements ............................................................................................20


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NOTICENotice is hereby given that the Twentieth One Annual

General Meeting of the Members of the Company will

be held on Friday , September 28, 2012 at 9:00 a.m.

at Rama Krishna Banquets Hall, Near Main Market,

Bhajanpura, Main Wazirabad Road, Delhi –110 053, to

transact the following business:

ORDINARY BUSINESS:

1. To receive, consider and adopt the Audited Balance

Sheet as at March 31, 2012 and the Profit & Loss

Account for the year ended as on that date and the

Reports of Auditors and Directors thereon.

2. To re-appoint Mr. Suresh Rajpal, Director who retires

by rotation and being eligible, has offered himself for

re-appointment.

3. To re-appoint Mr. Ashok Kumar Anand, Director who

retires by rotation and being eligible, has offered

herself for re-appointment.

4. To appoint M/s. Nath Ahuja & Co., Chartered

Accountants as Auditors of the Company who

shall hold office from the conclusion of this Annual

General Meeting until the conclusion of the next

Annual General Meeting and to authorize the Board

of Directors to fix their remuneration.

Registered Office: By Order of the

S-101, Panchsheel Park, Board of Directors

New Delhi-110 017.

Dated: August 01, 2012 Atul Kumar

Company Secretary

NOTES:1. A MEMBER ENTITLED TO ATTEND AND VOTE

AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER OT THE COMPANY.

The instrument of proxy should, however, be deposited at the Registered Office of the Company not less than 48 hours before the Meeting.

An explanatory statement pursuant to Section 173 of the Companies Act, 1956, in respect of the items under

2. The Register of Members and Share Transfer Books of the Company will remain closed from Wednesday September 26, 2012 to Friday 28, 2012 (both days inclusive).

3. Member are requested:

i. to kindly notify the change of address, if any to the Company/ the Registrar / Depository Participant.

ii. To bring their copy of the Annual Report,

iii. to deposit to duly completed attendance slip at the meeting

iv. In the process of postal ballot completed on 17th July 2012, the Special Resolution for the transfer of undertaking from Virtual soft Systems Limited to Raom1 Telecom Limited the relevant date was quoted as 17th June 2012. Subsequently as per the Direction of Bombay Stock Exchange the relevant date was 16th June-2012. The same has been brought to the notice of the shareholders hereby.

Registered Office: By Order of the S-101, Panchsheel Park, Board of DirectorsNew Delhi-110 017. Dated: August 01, 2012 Atul Kumar

Company Secretary


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DIRECTORS’ REPORTDear Shareholders,Your Directors take pleasure in presenting for your consideration and approval the Twentieth Annual Report of your Company for the financial year ended March 31, 2012.1 Financial Result

Particulars Year Ended Year Ended 31.03.2012 31.03.20111. (a) Net Sales/Income from Operations 430.73 125.66 (b) Other Operating Income 0.00 0.002. Expenditure a. Increase/decrease in stock in trade and work in progress 0.00 0.00 b. Consumption of raw materials 0.00 0.00 c. Purchase of traded goods 288.83 59.87 d. Employees cost 131.57 13.62 e. Depreciation 7.42 6.70 f. Other expenditure 134.21 47.05 g. Total 562.03 127.24 (Any item exceeding 10% of the total expenditure to be shown separately) 0.00 0.003. Profit from Operations before Other Income, Interest and Exceptional Items (1-2) (131.30) (1.58)4. Other Income 16.62 4.955. Profit before Interest and Exceptional Items (3+4) (114.68) 3.37 6. Interest 0.43 0.467. Profit after Interest but before Exceptional Items (5-6) (115.11) 2.91 8

Exceptional items 0.00 0.009. Profit (+)/ Loss (-) from Ordinary Activities before tax (7+8) (115.11) 2.9110. Tax expense 0.00 0.0011. Net Profit (+)/ Loss (-) from Ordinary Activities after tax (9-10) (115.11) 2.9112.

Extraordinary Item (net of tax expense Rs. 0.00 0.0013. Net Profit(+)/ Loss(-) for the period (11-12) (115.11) 2.9114. Paid-up equity share capital (Face Value of the Share shall be indicated) 754.76 754.7615. Reserve excluding Revaluation 20.00 20.0016. Earnings Per Share (EPS) a) Basic and diluted EPS before Extraordinary items for the period, (1.53) 0.04 for the year to date and for the previous year (not to be annualized) b) Basic and diluted EPS after Extraordinary items for the period, (1.53) 0.04 for the year to date and for the previous year (not to be annualized) 17. Public Shareholding - No. of shares 2,327,519 2,329,517 - Percentage of shareholding 30.84% 30.86%18. Promoters and promoter group Shareholding ** a) Pledged/Encumbered - Number of shares 0.00 0.00 - Percentage of shares (as a % of the total shareholding of promoter and promoter group) 0.00 0.00 - Percentage of shares (as a% of the total share capital of the company) 0.00 0.00 b) Non-encumbered - Number of Shares 5,220,081 5,518,083

- Percentage of shares (as a% of the total shareholding of promoter and promoter group) 69.16% 69.14% - Percentage of shares (as a % of the total share capital of the company) 69.16% 69.14%


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1. BUSINESS AND OPERATIONS OF THE COMPANY

VIRTUAL SOFT- LEVERAGING

MOBILE ROAMING, TELECOM, VIRTUAL EVENT & DEMAND GEN TECHNOLOGIES TO PROVIDE UNIQUE & EXCEPTIONAL “CONNECT ,COMMUNICATE & ENGAGE, EXPERIENTIALLY (C2E2)” PRODUCTS, PLATFORMS , PROGRAMS AND SOLUTIONS TO LARGE BUSINESS CUSTOMERS AND CONSUMERS

Video Rich Broadband & 3G / 4G mobile networks are revolutionizing the way we do business and run our lives. Virtual Soft and its v Reach division offer outstanding digital broadband solutions. They use technology developed in house and by our best-of –breed global partners to the advantage of large enterprises, associations and media companies as well as their customers and consumers. Broadband network & application solutions offer you a convergence of voice, data and video that can be used for your business – by creating and leveraging business function specific virtual events – both live & on-demand, ideally through an annual engagement contract with VirtualSoft.

Virtual Soft transforms conventional business, learning, entertainment and media enterprises into rich media digital corporations. It uses the technologies of the day to set up the infrastructure & application platforms needed for streaming interactive rich media content – as well as creating and managing virtual events - over the internet, intranet or extranet.

A proprietary system called v Code guarantees clarity and seamless delivery of audio, video and multimedia files across both narrowband and broadband networks.

Virtual Soft has developed a world-class Enterprise Communication Platform called vReach that utilizes existing corporate computing infrastructure to make real-time business meeting and events more cost-effective and convenient by reducing travel and extending reach to globally dispersed customers, partners, and co-workers over low and high bandwidth connections through a simple browser interface.

VirtualSoft’s vReach division also offers Rich Media content creation and migration services using proprietary technology and business methods. It creates near video

on-demand content synchronized with Power point slides and other interactive mechanisms for leading conference organizers like CII, FICCI, The Times of India Group, The Federation of Asian Advertising Associations, India Today; and for leading enterprises such as SAP, IBM, The World Bank and the Tata Group.

It has created over 10,000 hours of such content for over 500 different conferences and training events. This content is available in CD/DVD form as well as on knowledge on-demand servers accessible over the intranet and/or internet.

In the year under Review, we continued making progress on both the Digital Demand Generation and Telecom initiatives that were launched in the previous year.

In Demand Generation, we continued to strengthen the strategic partnership for India and APAC with 6Connex Inc. (www.6Connex.com) – a California based global leader in Virtual Experience based business solutions. Supplementing their technology with our own domain competence, processes and goto market ecosystem, Virtual Soft launched a range of next generation Virtual Experience based events for demand generation, customer engagement, collaboration, learning and knowledge management for brands like CNBC/ Web 18, Cisco, Oracle, and Intel – both at the India & APAC level.

Further, for Intel India we received a major demand generation assignment for their Small Medium Business (SMB) target audience in the Delhi/ NCR and Punjab territories. This was subsequently extended to Western and Southern India States.

The Telecom Division that launched global roaming solutions and services under the “Roam1” brand (www.roam1.com), continued to make significant progress in terms of innovative and and unique product introductions and plans as well gaining market share and acceptance – both from end –customers and channel partners.

Our flagship product here is the Global Single Sim Product, that contains 3 Telephone Numbers or Profiles (UK –Italy- USA) that provides low cost telephony in international roaming. This SIM provides Free Incoming in over 90 countries and provides low cost Call Back to India. This is offered through both a prepaid and post-paid plans, with real-time billing that allows the Indian Customer to control his international telephony expenses.


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The billing is in real time and is visible instantly on the net which ensures that there is no room for over billing. The customer gets to retain the card and can publish the number as his permanent International Number on his business card and stationary etc. This way every time the customer goes abroad, he adds talk time on his card which makes repeat business very easy for us. The Global Single SIM Product is supported by a wide array of country and continent specific products and plans for voice, data and Blackberry Messaging.

In the year under Review, with an intent to synergise the two divisions at a corporate level, the C2E2 Initiative was conceived. C2E2 stands for Connect Communicate Engage Experientially and provides a bridge for the Telecom & Roam 1 Division to collaborate with the Virtual Events and Demand Gen Division in technology & product development, marketing and large partner and account development. This will lead to unique cross developed product offerings (e.g mobile sales, mobile learning and mobile marketing & couponing tools and platforms), cost rationalization as well as more sales yield from our goto market partners and large enterprise accounts.

With the foundation in Enterprise Broadband solutions, Telecom and Roaming Solutions and now the C2E2 Initiative – all of which are scaling up well, the Company now expects significant growth in both revenues and profitability in the current year and the years to come

2 DIVIDEND

Your Directors do not recommend a dividend.

3. AUDITORS

M/s. Nath Ahuja & Co., Chartered Accountants, Auditors of the Company retire at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

4. DIRECTORS

Mr. Suresh Rajpal and Mr. Ashok Kumar Anand retire by rotation at the ensuing Annual General Meeting of the Company and being eligible offer themselves for reappointment.

5. DEPOSITS

The Company has not accepted deposits from the public for the year under consideration.

6. PARTICULARS OF EMPLOYEES

There is no employee of the Company who has received remuneration in excess of such sum as prescribed under Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

7. CAPITAL MARKET DEVELOPMENTS

As on date, 92.67% of Shares are in Demat form and are listed on various stock exchanges. The Company has, from time to time, reminded the shareholders/investor, holding the Shares in Physical form to convert their Shareholding to dematerialized form.

8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS AND OUTGO

(a) Details of Conservation of Energy

The Company uses electric energy for its equipment such as air-conditioners, computer terminals, lighting and utilities in the work premises.

All possible measures have been taken to conserve energy:

• By identifying potential areas for saving;

• By incorporating energy efficient equipment;

• By automation.

(b) Technology Absorption

Research & Development Specific areas in which Research & Development work has been done in the Company- Intranet Content Delivery Network (ICDN) solution. This solution helps Companies slash costs and raise intellectual capital.

© Foreign Exchange Earnings

There had been no foreign exchanges earnings, during the year.

9. DIRECTORS’ RESPONSIBILITY STATEMENT

Your Directors wish to state that:

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;


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(b) that they had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;

(c) that they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) that they had prepared the annual accounts on a going concern basis.

10. CORPORATE GOVERNANCE

A Separate statement an Corporate Governance along with the Auditor’s Certificate on its compliance is given as part of the Annual Reports.

11. ACKNOWLEDGEMENTS

Your Directors acknowledge with a deep sense of gratitude the continued support extended by investors, customers, business associates, bankers and vendors. Your Directors take this opportunity to thank the regulatory and governmental authorities.

For and on behalf of the Board of Directors

Place : New Delhi Mr. Gokul Tandan Mr. R.V.KulkarniDate : August 01, 2012 Managing Director Wholetime Director

Corporate Governance is about commitment to values and about ethical business conduct. Its about how an organization is managed. This includes its Corporate Structure, its culture, policies and manner in which it deals with various stakeholders. Accordingly timely and accurate disclosure of information regarding the financial situation, performance, ownership and governance of the Company is an important part of Corporate Governance. This improves public understanding of the structure, activities and policies of the Organization. Consequently the Organization is able to attract investors, and to enhance the trust and confidence of the stakeholders.

Your Company believes that sound Corporate Governance is critical to enhance and retain investor trust. Accordingly, your Company always seeks to attain its performance rules with integrity. The Board extends its fiduciary responsibilities in the widest sense of the term. Your Company’s endeavors to enhance long – term shareholder value and respect minority rights in all our business decisions.

1. VSL Philosophy on Corporate Governance 1. Satisfy the spirit of law and not just the letter

of the law. Corporate Governance standards should go beyond the law.

2. Be transparent and maintain high degree of disclosures levels. When in doubt, disclose.

3. Make a clear distinction between personal

conveniences and corporate resources.

4. Communicate externally, in a truthful manner, about how the Company is run internally.

5. Have a simple and transparent corporate structure driven solely by the business needs.

6. Management is the trustee of the shareholder’s capital and not the owner.

2. Board of DirectorsAt the core of its Corporate Governance practice is the Board, which oversees how the management serves and protects the long-term interests of all the stakeholders of the Company. Your Company believes that an active, well – informed and independent Board is necessary to ensure the highest standards of Corporate Governance. Majority of the Board, 2 out of 4, are independent Directors.

During the Financial Year ended 31st March 2012, Seven Board Meetings were held on 30.04.11, 30.05.011, 30.06.11, 30.07.11, 16.08.11, 31.10.12 & 31.01.12,

The Last Annual General Meeting was held on 30th September 2011 and the last Extra – ordinary General Meeting was held on 17th, July 2012.

The Composition of the Board, attendance of Directors at the Board Meetings held during the year under review as well as in the last Annual General Meeting and the number of other Directorships / Committee positions held by them are as under :-

Corporate Governance Report


6

S. No.

Name & Designation Category No. Of other Directorships

held

No of Board meetings

Attended last AGM

(30 .09.11)Held Attended

1. Mr. Gokul Tandan MD 6 7 7 Yes

2. Mr. Rajendra V. Kulkarni WTD 6 7 7 Yes

3. Mr. Suresh Rajpal NEID 3 7 3 No

4. Mr. Ashok Anand NEID 1 7 7 No

(MD- Managing Director, WTD – Whole Time Director, NEID – Non-Executive Independent Director)

Directorship / Committee Positions

S. No.

Name of the Director Directorships Committees Positions

Name of the Company Committee Position

1. Mr. Gokul Tandan 7 1. M/s. Goto Customers Services Pvt. Ltd.2. M/s. Virtual Software & Training Pvt.Ltd.3. CPM India Sales & Marketing Pvt. Ltd4. M/s. Foundation Technologies ( Pvt.) Ltd.5. M/s. Digitivate Solutions Pvt. Ltd.6. M/s. Vreach Solutions Pvt. Ltd.7. M/s. Roam1 Telecom Ltd.

DirectorDirectorDirectorDirectorDirectorDirectorDirector

2. Mr.Rajendra V. Kulkarni 14 1. M R Capital Pvt. Ltd.2. M/s. Vijay Stampings Pvt. Ltd.3. M/s. Prime Valves India Ltd.4. M/s. Marble Arch Estate Pvt. Ltd.5. M/s. Verna Estate Pvt. Ltd.6. M/s. Mountain Valley Springs Pvt. Ltd.7. M/s. Multiple Zones India Pvt. Ltd.8. M/s. Foundation Technologies ( Pvt.) Ltd.9. M/s. Virtual Software & Training (P). Ltd.10. M/s. MZI Services India Pvt. Ltd.11. M/s.SME Business Services Ltd.12. M/s. Office Zone Products Pvt. Ltd.13. M/s. Kromium Consulting Pvt. Ltd.14. Roam1 Telecom Ltd.

DirectorDirectorDirectorDirectorDirectorDirectorDirectorDirectorDirectorDirectorDirectorDirectorDirectorDirector

3. Mr. Suresh Rajpal 8 1. M/s. Vishnova Solution Pvt. Ltd.2. M/s Gisil Design Pvt.Ltd.3. M/s. Electronic Tender.Com(India) Pvt.Ltd4. M/s. Inde Pay networksPvt.Ltd.5. M/s. Navis EximPvt.Ltd6. M/s. Cosmo Films Ltd.7. M/s. Visnova InteractivePvt.Ltd.8. M/s. Inde Livelihood Foundation

DirectorDirectorDirectorDirectorDirectorDirectorDirectorDirector

4. Mr. Ashok Anand 6 1. M/s.Inprint Marketing Pvt.Ltd.2. M/s.First Choice Graphics Pvt.Ltd.3. M/s. Inprint Expotech Pvt Ltd.`4. M/s. Inprint Exclisives India Pvt.Ltd.5. M/s.SourceGraphics India Pvt.Ltd.6. M R Towers Pvt.Ltd.

DirectorDirectorDirectorDirectorDirectorDirector

None of the Directors on the Board hold Directorships in more than fifteen Companies and hold memberships in more than ten Committees and they do not act as Chairman of more than five Committees across all the Companies in which they are Directors.


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2.1 Information Placed before the BoardIn addition to the matters which statutorily require Board’s approval, as required by Corporate Governance, the following matters are regularly placed before the Board :-

- Minutes of Audit Committee Meetings, Share Transfer & Investors Grievance Committee Meetings.

- Recruitment and Remuneration of senior executives below the board level.

- Details of Joint Ventures / Collaboration Agreement.

- Disclosure of material related party transaction, if any

- Compliance with Regulatory and statutory requirements including listing requirement & Shareholders services.

- Details of show cause, demand, prosecution and penalty notices which are materially important

- Transactions involving substantial payments towards goodwill, brand equity or intellectual Property.

- Sale of material nature of investments, subsidiaries and assets, which are outside the normal course of business.

3. Committees of the BoardIn terms of the SEBI code, the Board of the Company has constituted the Following Committees: -

Audit CommitteeShare Transfer and Investors Grievance Committee.

3.1 Audit Committee

The following are the members and their attendance at the committee meetings: -

S.No. Name of Directors Status No. of meetings

Held Attended

1. Mr. Ashok Kumar Anand Chairman 4 4

2. Mr. Suresh Rajpal Member 4 2

3. Mr. Rajendra V Kulkarni Member 4 4

4. Mr. Ashok Anand NEID 7 7

During the period 01.04.011 to 31.03.12, the Audit Committee met 4 times on 30.05.11, 31.07.11, 31.10.11 & 31.01.12]

The broad terms of references of Audit Committee are as follows: -

- Overseeing the Company’s financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible.

- Recommending the appointment / re- appointment of external and internal auditors, tax auditors, fixation of statutory audit fees, internal audit fees and tax audit fees and also approval for payment of any other services.

- Review and management the annual financial statements before submission to the Board.

- Review quarterly UN – audited /audited financial

results, half yearly review report.

- Review with Management, external and internal auditors the adequacy of internal control system.

- Review the adequacy of internal audit programme, internal audit reports; follow up reports and guidelines prepared for internal audit.

- To do any internal investigations either departmentally or with the help of internal auditors or any other outside agency into matters where they are suspected fraud or irregularities.

- Discussion with external Auditors before the Audit commences about nature and scope of audit as well as have post audit discussion to ascertain any area of concern.

- Review the Company’s financial and Risk management policies.

- To look into the reasons for substantial defaults in


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the payment to the depositors, debenture holders, shareholders and creditors.

3.2 Share Transfer and Investors Grievance Committee

The Committee consists of two Directors and Company Secretary including whole time Director and is chaired by managing Director.

This Committee looks into transfer and transmission of Shares, issue of duplicate share certificates,

consolidation and sub – division of shares and investors’ grievance. This Committee particularly looks into Investors Grievances and oversees the performance of the in- house Share Department/ Share Transfer Agents and to ensure prompt and efficient investors’ services. The Committee met Four times during the year 2011 – 2012. The following are the members and their attendance at the Committee Meetings: -

Name of Member No. of meetings

Held Attended

1. Mr. Gokul Tandan 4 4

2. Mr. Rajendra V. Kulkarni 4 4

3. Mr. Atul Kumar 4 4

4. General Body Meetings Location and time where General Meetings held in the last 3 years is given below:

Year AGM / EGM LOCATION DATE TIME

2011 - 2012 EGM S-101, Panchsheel Park, New Delhi-17 17 07.2012 Postal Ballot

2010 - 2011 AGM Rama Krishna Banquets Hall, Near Main Market, Bhajanpura, Main Wazirabad Road, Delhi – 110 053

30 09.2011 9:00 A.M.


30 09.2010 9:00 A.M.


30 09.2009 9:00 A.M.

No special resolution was put through postal ballot in the last AGM. At the ensuing AGM also there is no such resolution to be passed through Postal Ballot.

5. Disclosures on materially significant related party transactions with Promoters, Directors, Management, their Subsidiaries or Relatives etc., which may have potential conflict with the interest of the Company at large.

None of the materially significant transactions with any of the related parties were in conflict with the interest of the Company.

6. Non – compliance by Company, penalties, strictures imposed on the Company by Stock Exchanges / Securities and Exchange Board of India (SEBI) etc.

During the last three years, there were no strictures or penalties or penalties imposed by either SEBI or the Stock Exchanges or any Statutory Authority for non – compliance of any matter related to the Capital Markets.

7. Means of Communication

This is being done through Quarterly, half yearly and annual results, which are being published in English and Hindi daily newspapers

8. General Shareholders Information:

Detailed information in this regard provided in the shareholder information section forms part of this Annual Report.

9. Compliance Certificate of the Auditors

The Statutory Auditors have certified that the Company has complied with the conditions of Corporate Governance as stipulated in clause 49 of the Listing Agreement with the Stock Exchanges and the same is annexed to The Director’s Report.

The Certificate form the Statutory Auditors will be sent to the Listed Stock Exchanges along with the Annual Return of The Company.


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SHAREHOLDERS INFORMATION

Registered Office : S-101, Panchsheel Park, New Delhi-110 017

Annual General Meeting : Date & Time: 28th September, 2012 At 9:00 A .M.

Venue : Rama Krishna Banquets Hall, Near Main Market, Bhajanpura,

Main Wazirabad Road, Delhi – 110 053

Financial Calender :

- Financial reporting for the quarter ending June 30. 2012 : End July 2012

- Financial reporting for the quarter ending Sep 30. 2012 : End Oct 2012

- Financial reporting for the quarter ending Dec 31. 2012 : End Jan 2013

- Financial reporting for the Year ending March 31. 2013 : End April 2013

Date of Book Closures: September 26, 2012 to September 28, 2011, both days inclusive.

Listing on Stock Exchanges:

The Equity Shares of the Company are listed on the Stock Exchange at Delhi, Mumbai, Jaipur & Ahemadabad.


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Statement Showing Shareholding PatternCat-egory code

Category of Shareholder

Number of Share-

holders

Total number

of shares

Number of shares held in demateri-alized form

Total shareholding as a percentage

of total number of shares

Shares Pledged or other-wise encumbered

As a per-centage

of(A+B)1

As apercent-

age of (A+B+C)

Number of

shares

As a percent-age

(I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX)= (VIII)/(IV)*100

(A) Shareholding of Promoter and Promoter Group2

1 Indian(a) Individuals/ Hindu Undivided Family 2 640083 640083 8.48 8.48 0 0.00(b) Central Government/ State Government(s) 0.00 0.00 0 #DIV/0!(c) Bodies Corporate 2 4580000 4580000 60.68 60.68 0.00(d) Financial Institutions/ Banks 0.00 0.00 #DIV/0!

(e) Any Others(Specify) 0.00 0.00 #DIV/0!(e-i) 0.00 0.00 #DIV/0!(e-ii) 0.00 0.00 #DIV/0!

Sub Total(A)(1) 4 5220083 5220083 69.16 69.16 0 0.002 Foreigna "Individuals (Non-Residents Individuals/

Foreign Individuals)"0.00 0.00 0 #DIV/0!

b Bodies Corporate 0.00 0.00 0 #DIV/0!c Institutions 0.00 0.00 0 #DIV/0!d Any Others(Specify) 0.00 0.00 0 #DIV/0!

Sub Total(A)(2) 0 0 0 0.00 0.00 0 #DIV/0!Total Shareholding of Promoter and Pro-moter Group (A)= (A)(1)+(A)(2)

4 5220083 5220083 69.16 69.16 0 0.00

Sub Total(A)(2) 0 0 0 0.00 0.00 0 #DIV/0! Total Shareholding of Promoter and Pro-

moter Group (A)= (A)(1)+(A)(2)4 5218083 4218083 69.14 69.14 0 0.00

(B) Public shareholding1 Institutions(a) Mutual Funds/ UTI 0.00 0.00(b) Financial Institutions / Banks 1 50000 50000 0.66 0.66 0 0.00(c) Central Government/ State Government(s) 0.00 0.00(d) Venture Capital Funds 0.00 0.00(e) Insurance Companies 0.00 0.00(f) Foreign Institutional Investors 0.00 0.00(g) Foreign Venture Capital Investors 0.00 0.00(h) Any Other (specify) 0.00 0.00(h-i) 0.00 0.00(h-ii) 0.00 0.00

Sub-Total (B)(1) 1 50000 50000 0.66 0.66 0 0.00B 2 Non-institutions(a) Bodies Corporate 43 87286 76886 1.16 1.16 0 0.00(b) IndividualsI Individuals -i. Individual shareholders holding

nominal share capital up to Rs 1 lakh2676 870777 488231 11.54 11.54 0 0.00

II ii. Individual shareholders holding nominal share capital in excess of Rs. 1 lakh.

18 1145346 1135336 15.17 15.17 0 0.00

(c) Any Other (specify)(c-i) Non Resident India 52 167800 17500 2.22 2.22 0 0.00(c-ii) Clearing Member 6 6308 6308 0.08 0.08 0 0.00 Sub-Total (B)(2) 2795 2277517 1724261 30.18 30.18 0 0.00(B) Total Public Shareholding (B)= (B)

(1)+(B)(2)2796 2327517 1774261 30.84 30.84 0.00

TOTAL (A)+(B) 2800 7547600 6994344 100.00 100.00 0.00(C) Shares held by Custodians and against

which Depository Receipts have been issued

1 Promoter and Promoter Group 0.00 0 #DIV/0!2 Public 0.00 0 0

Sub-Total (C ) 0 0 0 0 0 0 GRAND TOTAL (A)+(B)+(C) 2800 7547600 6994344 100.00 0 0.00


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Status of Dematerialization as on March 31, 2012

PARTICULARS NO. OF SHARES % TO TOTAL CAPITAL

National Security Depository Limited 6406757 84.88%

Central Depository Services (India) Limited 587587 7.79%

TOTAL DEMATERIALIZED 6994344 92.67%

PHYSICAL 553256 7.33%

GRAND TOTAL 7547600 100%

CERTIFICATE ON CORPORATE GOVERNANCE CERTIFICATE

M/s VIRTUAL SOFT SYSTEMS LIMITED

1. We have examined the compliance of conditions of Corporate Governance by M/s. VIRTUAL SOFT SYSTEMS LIMTED. (‘the Company’) for the year ended 31st March, 2012 as stipulated in Clause 49 of the Listing Agreement of the said with various Stock Exchange (hereinafter referred to as “the agreement”.

2. The Compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination was limited to the procedures and implementation thereof, adopted by the company for ensuring the compliance of the conditions of the Company.

3. In our opinion and based on our review and to the best of our information and according to the explanations given to us, we certify that the conditions of the Corporate Governance as stipulated I clause 49 of the agreement have been complied with in all material aspects of the Company.

4. As required by the Guidance note issued by the institute of Chartered Accountants of India, we have to state that as per the records maintained by the Share transfer and / Investor Grievance Committee, there was o investor except in cases which are constrained by disputes and legal impediments.

5. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

For S. R. Sharma & AssociatesPracticing Company SecretaryMembership No. 3942

Place : New Delhi Date : 01 Aug, 2012


12

The Members

1. We have audited the attached Balance Sheet of Virtualsoft Systems Limited as at March 31, 2012 and also the Profit and Loss Account and the Cash flow statement of the company for the year ended on that date, annexed thereto. These financial statements are the responsibility of the company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor’s Report) Order, 2003 as amended by the companies (Auditor’s Report )Amendment Order 2004 issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956 and on the basis of such checks of the books and records of the company as we considered appropriate and according to the information and explanation given to us , we have given in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above:

(i) We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;

(ii) In our opinion, proper books of account as required by law have been kept by the company so far as appears from the examination of the books;

AUDITORS REPORT(iii) The balance sheet and the profit and loss

account and cash flow statement dealt with by this report are in agreement with the books of account;

(iv) In our opinion, the balance sheet and the profit and loss account and cash flow statement dealt with by this report comply with the requirements of the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956;

(v) On the basis of written representations received from the directors, and taken on record by the Board of Directors, we report that none of the directors are disqualified as on March 31, 2012 from being appointed as directors in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956;

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said Balance Sheet and Profit & Loss account read together with the Significant Accounting Policies & Notes thereon, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view: -

a) In the case of the balance sheet, of the state of affairs of the company as at 31st March 2012;

b) In the case of the profit and loss account, of the Loss for the year ended on that date; and

c) In the case of the Cash flow statement, of the Cash flows for the year ended on that date.

For Nath Ahuja & Co.Chartered Accountants

FRN No. 001083N(N.N. Ahuja)

Place : New Delhi ProprietorDate : 01.08.2012 M. No: 80178


13

ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR AUDITOR’S REPORT OF EVEN DATE ON THE ACCOUNTS FOR THE YEAR ENDED MARCH 31, 2012 OF VIRTUAL SOFT SYSTEMS LTD.

1. (a) The company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.

(b) In our opinion, the fixed assets have been physically verified by the management at reasonable intervals, having regard to the size of the company and the nature of its assets.

(c) During the year, in our opinion, a substantial part of the fixed assets has not been disposed off by the company.

2. (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

(b) In our opinion, the procedures for physical verification of inventory followed by the Management are reasonable and adequate having regard to the size of the company and nature of its business.

(c) The company is maintaining proper records of inventory and no discrepancies were noticed on physical verification of inventories as compared to book records

3. (a) There is no party covered in the register maintained under section 301 of the companies Act, 1956 of the Companies Act, 1956 to whom the company has granted loans/Advances.

(b) There are parties covered in the register maintained under section 301 of the Companies Act, 1956 from whom the company has taken loans/Advances. The amount involved during the year in the transaction was Rs 2,31,96,877/- and the company has repaid a total amount of Rs. 30,51,000/- towards the loan/ Advances during the year.

(c) In our opinion, the rate of interest and other terms and conditions on which loans have been taken from/granted to companies,

firms or other parties listed in the register maintained under section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the company.

(d) The company is regular in repaying the principal amounts as stipulated and has been regular in the payment of interest wherever applicable.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control procedures commensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets and with regard to the sale of goods/services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

5 (a) According to the information and explanations given to us, we are of the opinion that the transactions that need to be entered into the register maintained under section 301 of the Companies Act, 1956 have been entered.

(b) The transactions made in pursuance of contracts or arrangements refer to in section 301 of the Act are, in our opinion at prices which are reasonable having regard to the prevailing market prices at the relevant time.

6 The Company has not accepted any deposit from the public with in the provision of section 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975.

7 To the best of our knowledge and according to the explanation given to us the Central Government has not prescribed maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956.

8 (a) According to the information and explanation given to us, the Company has not been regular in deposit of the provident fund, and TDS during the year with the appropriate authorities. As explained to


14

us, the provisions of Employees’ State Insurance Act, 1948, are not applicable to the Company.

(b) According to the information and explanations given to us, there was no undisputed amounts payable in respect of income tax, wealth tax, sales tax, customs duty, excise duty and cess were in arrears, as at 31st March, 2012 for a period of more than six month form the date they became payable except for Tax deducted at source amounting to Rs: 6,01,278/-

(c) According to the information and explanation given to us, there are no dues of sales tax, customs duty, wealth tax, excise duty and cess, which have not been deposited on account of any dispute.

9 In our opinion the accumulated losses of the company amounting to Rs 1462.18 Lakhs are more than fifty percent of its net worth Rs. -687.42 Lakhs. The company has a loss of Rs. 126.32lakhs in the current year.

10 According to the information and explanation given to us the company has not defaulted in repayment of dues to any financial institution/bank.

11 According to the information and explanation given to us the company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

12 In our opinion, the company is not a chit fund or a nidhi/ mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor’s Report) Order, 2003 are not applicable to the company.

13 In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor’s Report) Order, 2003 are not applicable to the company.

14 In our opinion, the terms and conditions on which the company has given guarantees for loans taken by others from banks or financial institutions are not prejudicial to the interest of the company.

15 In our opinion and according to the information and explanation given to us term loan amounting Rs.4,45,000/-have been taken by the company.

16 According to the information and explanations given to us and on an overall examination of the balance sheet of the company, we report that the no funds raised on short-term basis have been used for long-term investment. No long-term funds have been used to finance short-term assets except permanent working capital.

17 According to the information and explanations given to us, the company has not made preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Act.

18 The company has not issued the debentures during the year; question of creating security does not arise.

19 The company has not raised any money by public issues during the period covered in our audit.

20 According to the information and explanations given to us, no fraud on or by the company has been noticed or reported during the course of our audit.

For Nath Ahuja & Co.Chartered Accountants

FRN No. 001083N

(N.N. Ahuja)Place : New Delhi ProprietorDate : 01/08/2012 M. No: 80178


15

BALANCE SHEETAs on 31 March, 2012

Particulars Note No. As at 31 March, 2012

As at 31 March, 2011

Amount in INR Amount in INR A EQUITY AND LIABILITIES

1 Shareholders’ funds(a) Share capital 1 75,476,000 75,476,000 (b) Reserves and surplus 2 (143,096,029) (131,585,678)(c) Money received against share warrants - -

(67,620,029) (56,109,678)2 Share application money pending allotment 20.1 3,650,000 3,250,000 3 Non-current liabilities

(a) Long-term borrowings 3 90,645,151 71,503,577 90,645,151 71,503,577

4 Current liabilities(a) Short-term borrowings 4 230,103 125,698 (b) Trade payables 5 6,460,523 1,509,489 (c) Other current liabilities 6 6,539,459 5,436,086 (d) Short-term provisions 7 559,846 470,885

13,789,931 7,542,158 TOTAL 40,465,053 26,186,057

B ASSETS1 Non-current assets

(a) Fixed assets(i) Tangible assets 8A 4,180,724 2,666,203 (ii) Intangible assets 8B 9,450 - (iii) Capital work-in-progress 18,279,600 10,756,011

22,469,774 13,422,214 (b) Long-term loans and advances 9 1,921,426 1,345,970 (c) Other non-current assets - - (d) Non Current Investment 10 499,940 -

2,421,366 1,345,970 2 Current assets

(a) Inventories 11 1,412,571 200,432 (b) Trade receivables 12 7,776,169 2,789,064 (c) Cash and cash equivalents 13 1,362,358 2,129,106 (d) Short-term loans and advances 14 5,022,814 6,299,271

15,573,912 11,417,873 TOTAL 40,465,053 26,186,057

See accompanying notes forming part of the financial statements

19

In terms of our report attached.

For Nath Ahuja & Company For and on behalf of the Board of Directors Chartered Accountants FRN No. - 001083N

N.N.Ahuja Rajendra V. Kulkarni Gokul Tandan Atul KumarProprietor Whole-time Director Managing Director Company SecretaryM. No. - 80178

Place : New Delhi Date : 01.08.2012


16

Statement of Profit and Loss for the year ended 31 March, 2012

Particulars Note No. For the year ended31 March, 2012

For the year ended31 March, 2011"

Amount in INR Amount in INR A CONTINUING OPERATIONS

1 Revenue from operations (gross) 15 44,809,426 12,843,793 Revenue from operations 44,809,426 12,843,793

2 Expenses(a) Purchases of stock-in-trade 16 A 9,821,169 2,710,946 (b) Changes in inventories of finished goods, work-in-progress and stock-in-trade

16 B (1,212,139) (200,432)

(c) Employee benefits expense 17 13,156,708 1,365,459 (d) Other expenses 18 33,812,273 8,007,582 Total 55,578,001 11,883,555

3 Earnings before exceptional items, extraordinary items, interest, tax, depreciation and amortisation (EBITDA) (1 - 2)

(10,768,574) 960,238

4 Depreciation and amortisation expense 8 C 741,777 669,803 5 Profit / (Loss) before exceptional and extraordinary items

and tax (3 + 4 + 5 + 6) (11,510,351) 290,435

6 Profit / (Loss) before extraordinary items and tax (7 + 8) (11,510,351) 290,435 7 Profit / (Loss) before tax (9 + 10) (11,510,351) 290,435 8 Tax expense:

(a) Current tax expense for current year - - (b) (Less): MAT credit (where applicable) - - (c) Current tax expense relating to prior years - - (d) Net current tax expense - - (e) Deferred tax - -

9 Profit / (Loss) for the year (13 + 15) (11,510,351) 290,435 10i Earnings per share (of ` 10/- each):

(a) Basic(i) Continuing operations 24 b (1.53) 0.04 (ii) Total operations 24c (1.53) 0.04 (b) Diluted(i) Continuing operations 24f (1.53) 0.04(ii) Total operations 24g (1.53) 0.04

10.ii Earnings per share (excluding extraordinary items) (a) Basic(i) Continuing operations 24d (1.53) 0.04(ii) Total operations 24e (1.53) 0.04 (b) Diluted(i) Continuing operations 24h (1.53) 0.04(ii) Total operations 24i (1.53) 0.04 See accompanying notes forming part of the financial statements






17

Cash Flow Statement for the year ended 31 March, 2012

Particulars For the year ended 31 March, 2012

For the year ended 31 March, 2011

Amount in INR Amount in INR Amount in INR Amount in INR A. Cash flow from operating activitiesNet Profit / (Loss) before extraordinary items and tax

(11,510,351) 290,000

Adjustments for:Depreciation and amortisation 741,777 670,000 Net unrealised exchange (gain) / loss - -

741,777 670,000 Operating profit / (loss) before working capital changes

(10,768,574) 960,000

Changes in working capital:Adjustments for (increase) / decrease in operating assets:Inventories (1,212,139) (200,000)Trade receivables (4,987,105) (792,000)Short-term loans and advances 1,276,457 (2,529,000)Long-term loans and advances (575,456) 799,000 Other current assets - - Other non-current assets - -

Adjustments for increase / (decrease) in operating liabilities:Trade payables 4,951,034 - Other current liabilities 1,103,373 3,083,000 Other long-term liabilities - - Short-term provisions 88,961 - Long-term provisions - 645,125 361,000 Cash flow from extraordinary items - - Cash generated from operations (10,123,450) 1,321,000 Net income tax (paid) / refunds - -

Net cash flow from / (used in) operating activities (A)

(10,123,450) 1,321,000

B. Cash flow from investing activitiesCapital expenditure on fixed assets, including capital advances

(9,789,337) (10,977,000)

Investment in equity shares (499,940) - -Amounts received from AOPs - - Amounts received from LLPs - -


18



Amount in INR Amount in INR Amount in INR Amount in INR (10,289,277) (10,977,000)

Cash flow from extraordinary items - - (10,289,277) (10,977,000)

Net income tax (paid) / refunds - - Net cash flow from / (used in) investing activities (B)

(10,289,277) (10,977,000)C. Cash flow from financing activitiesProceeds from issue of equity shares - - Proceeds from issue of preference shares - - Redemption / buy back of preference / equity shares

- -

Proceeds from issue of share warrants - - Share application money received / (refunded)

400,000 3,250,000

Proceeds from long-term borrowings 19,141,574 4,950,000 Repayment of long-term borrowings - - Net increase / (decrease) in working capital borrowings

- -

Proceeds from other short-term borrowings 104,405 2,051,000 Repayment of other short-term borrowings - - Finance cost - - Dividends paid - - Tax on dividend - -

19,645,979 10,251,000 Cash flow from extraordinary items - -

19,645,979 10,251,000 Net cash flow from / (used in) financing activities (C)

19,645,979 10,251,000

Net increase / (decrease) in Cash and cash equivalents (A+B+C)

(766,748) 595,000

Cash and cash equivalents at the beginning of the year

2,129,106 1,534,000

Effect of exchange differences on restatement of foreign currency Cash and cash equivalents

- -

Cash and cash equivalents at the end of the year

1,362,358 2,129,000

Reconciliation of Cash and cash equivalents with the Balance Sheet:


19



Amount in INR Amount in INR Amount in INR Amount in INR Cash and cash equivalents as per Balance Sheet (Refer Note 12)

1,362,358 2,129,106

Less: Bank balances not considered as Cash and cash equivalents as defined in AS 3 Cash Flow Statements (give details)

- -

Net Cash and cash equivalents (as defined in AS 3 Cash Flow Statements) included in Note 19

1,362,358 2,129,106

Add: Current investments considered as part of Cash and cash equivalents (as defined in AS 3 Cash Flow Statements) (Refer Note (ii) to Note 16 Current investments)

- -

Cash and cash equivalents at the end of the year *

1,362,358 2,129,106

* Comprises:(a) Cash on hand 609,428 1,627,925 (b) Cheques, drafts on hand - - (c) Balances with banks(i) In current accounts 752,930 501,181 (ii) In EEFC accounts - - (iii) In deposit accounts with original maturity of less than 3 months

- -

(iv) In earmarked accounts (give details) (Refer Note (ii) below)

- -

(d) Others (specify nature) - - (e) Current investments considered as part of Cash and cash equivalents

- -

1,362,358 2,129,106 See accompanying notes forming part of the financial statements






20

Notes forming part of the financial statementsNote 1 Share capital

Particulars As at 31 March, 2012 As at 31 March, 2011 Number of

shares Amount in

INR Number of

shares Amount in

INR (a) Authorised 15,000,000 150,000,000 15,000,000 150,000,000 Equity shares of Rs.10/- each

15,000,000 150,000,000 15,000,000 150,000,000 (b) Issued 7,547,600 75,476,000 7,547,600 75,476,000 Equity shares of Rs.10/- each

7,547,600 75,476,000 7,547,600 75,476,000 (c) Subscribed and fully paid up 7,547,600 75,476,000 7,547,600 75,476,000 Equity shares of Rs.10/- each

7,547,600 75,476,000 7,547,600 75,476,000 Total 7,547,600 75,476,000 7,547,600 75,476,000

Note 1A Share capital (contd.)

(i) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting period:

Particulars Opening Balance

Fresh issue Bonus ESOP Conversion Buy back Other changes

(give details)

Closing Balance

Equity shares Year ended 31 March, 2012

- Number of shares 7,547,600 - - - - - - 7,547,600 - Amount (Rs.10/- each) 75,476,000 - - - - - - 75,476,000

Year ended 31 March, 2011- Number of shares 7,547,600 - - - - - - 7,547,600 - Amount (Rs.10/- each) 75,476,000 - - - - - - 75,476,000

Note 1B Share capital (contd.)

Notes:

(i) Details of shares held by the holding company, the ultimate holding company, their subsidiaries and associates:

Particulars Equity shares with

voting rights

Equity shares with differential

voting rights

Compulsorily convertible

preference shares

Optionally convertible

preference shares

Redeemable preference

sharesNumber of shares

As at 31 March, 2012 Virtual Software and Tranining Private Limited, the holding company

4,500,000 - - - -

Subsidiaries of the holding company As at 31 March, 2011 Virtual Software and Training Private Limited, the holding company

4,500,000 - - - -

Subsidiaries of the holding company


21

(ii) Details of shares held by each shareholder holding more than 5% shares:

Class of shares / Name of shareholder As at 31 March, 2012 As at 31 March, 2011

Number of shares held

% holding in that class of

shares

Number of shares held

% holding in that class of

shares

Equity shares

Mohini Tanda 640,083 8.48% 640,083 8.48%

Virtual Software and Tranining Private Limited.

4,500,000 59.62% 4,500,000 59.62%

Note 2 Reserves and surplus

Particulars As at 31 March, 2012 As at 31 March, 2011

Amount in INR Amount in INR

(a) Capital reserve

Opening balance 2,000,000 2,000,000

Add: Additions during the year - -

Less: Utilised / transferred during the year - -

Closing balance 2,000,000 2,000,000

(b) Surplus / (Deficit) in Statement of Profit and Loss

Opening balance (133,585,678) (133,876,113)Add: Profit / (Loss) for the year (11,510,351) 290,435 Closing balance (145,096,029) (133,585,678)

Note 3 Long-term borrowings



(a) Term loans

From banks

Secured(secured against hypothecation Car) 367,027 -

(b) loans and advances from related parties

Unsecured 90,278,125 71,503,578

Total 90,645,152 71,503,578

Note 4 Short-term borrowings



(a) Other Loans and advances(Overdraft & security received)

Unsecured 230,103 125,698

Total 230,103 125,698


22

Note 5 Trade payables



Trade payables:

Other than Acceptances 6,460,523 1,509,489

Total 6,460,523 1,509,489

Note 6 Other current liabilities



(a) Unpaid dividends 71,240 71,240

(i) Statutory remittances (Contributions to PF and ESIC, Withholding Taxes, Excise Duty, VAT, Service Tax, etc.)

2,333,316 2,575,522

(ii) Advances from customers 657,633 440,103

(iii) Others (Expenses Payable) 3,477,270 2,349,221

Total 6,539,459 5,436,086

Note 7 Short-term provisions



(a) Provision for employee benefits:

(i) Provision for gratuity 352,905 291,636

(ii) Provision for other employee benefits (Leave Encashment)

206,941 179,249

Total 559,846 470,885


23

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26

Note 8C Fixed assets (contd.)

C. Depreciation and amortisation relating to continuing operations:

Particulars As at 31 March, 2012 As at 31 March, 2011 Amount in INR Amount in INR

Depreciation and amortisation for the year on tangible assets as per Note 8 A

740,727 669,803

Depreciation and amortisation for the yearon intangible assets as per Note 8 B

1,050 -

Less: Utilised from revaluation reserve - - Depreciation and amortisation relating to continuing operations 741,777 669,803

Note 9 Long-term loans and advances


(a) Security deposits Unsecured, considered good 1,138,206 562,750

1,138,206 562,750 (b) Others Unsecured, considered good 783,220 783,220 Total 1,921,426 1,345,970

Note 10 Non Current Investments


Investment in Equity InstrumentsSubsidiary CompanyUnquoted Trade InvestmentRoam 1 Telecom Limited -49,994 Equity Shares (Previous Year - NIL), of Rs. 10 each, 499,940 Fully PaidTotal 499,940 -

Note 11 Inventories(At lower of cost and net realisable value)


(a) Stock-in-trade (acquired for trading) 1,412,571.00 200,432 Total 1,412,571.00 200,432

Note 12 Trade receivables


Trade receivables outstanding for a period exceeding six months from the date they were due for payment Unsecured, considered good 2,442,311 2,061,270 Doubtful - -

2,442,311 2,061,270 Less: Provision for doubtful trade receivables 366,347 -

2,075,964 2,061,270 Other Trade receivablesUnsecured, considered good 5,700,205 727,794

5,700,205 727,794 Total 7,776,169 2,789,064


27

Note 13 Cash and cash equivalents



(a) Cash on hand 609,428 1,627,925

(b) Balances with banks

(i) In current accounts 752,930 501,181

Total 1,362,358 2,129,106

Note 14 Short-term loans and advances



(a) Loans and advances to related parties (Refer Note 23)"

Unsecured, considered good 1,120,021 1,943,166

1,120,021 1,943,166

(b) Loans and advances to employees Unsecured, considered good 239,673 919,231

Doubtful - -

239,673 919,231

(c) Prepaid expenses - Unsecured, considered good 390,425 9,409

(d) Balances with government authorities Unsecured, considered good

(i) Service Tax credit receivable 38,049 643,781

(ii) Advance Tax and TDS 1,354,773 1,834,052

1,783,247 2,487,242

(e) Others Unsecured, considered good 1,879,873 949,634

1,879,873 949,634

Total 5,022,814 6,299,273

Note 15 Revenue from operations



(a) Sale of products @ (Refer Note (i) below) 11,310,237 3,707,604

(b) Sale of services @ (Refer Note (ii) below) 31,837,239 8,858,184

(c) Other operating revenues # (Refer Note (iii) below) 1,661,950 278,005

44,809,426 12,843,793

Total 44,809,426 12,843,793


28

Note Particulars For the year ended 31 March, 2012


Amount in INR Amount in INR (i) Traded goods

International Roaming Cards 11,310,237 3,707,604 Total - Sale of products 11,310,237 3,707,604

(ii) Sale of services comprises

Video Recording Services 29,324,127 8,858,184 IVR setup charges 2,513,113 - Total - Sale of services 31,837,239 8,858,184

(iii) Other operating revenues # comprise:Others (Plan Activation Charges, Service charges,Rental revenue)

1,661,950 278,005

Total - Other operating revenues 1,661,950 278,005

Note 16 A Purchase of traded goods



Amount in INR Amount in INR International Roaming Cards 9,821,159 2,710,946

Total 9,821,159 2,710,946

Note 16 B Changes in inventories of finished goods, work-in-progress and stock-in-trade



Amount in INR Amount in INR Inventories at the end of the year:

Stock-in-trade 1,412,571 200,432 1,412,571 200,432

Inventories at the beginning of the year:Stock-in-trade 200,432 -

200,432 - Net (increase) / decrease (1,212,139) (200,432 )

Note 17 Employee benefits expense



Amount in INR Amount in INR Salaries and wages 12,822,672 1,178,325

Contributions to provident and other funds (Refer Note 21) 123,824 150,165 Staff welfare expenses 182,520 27,017 Leave encashment 27,692 9,952 Total 13,156,708 1,365,459


29

Note 18 Other expenses



Amount in INR Amount in INR Direct Expenses 19,062,437 3,329,316

Power and fuel 389,426 76,823 Rent including lease rentals 2,137,612 688,218 Repairs and maintenance - Buildings 106,128 154,927 Repairs and maintenance - Machinery 48,383 11,450 Repairs and maintenance - Others 329,901 81,472 Car running expenses 322,000 10,553 Fees & Subscription 90,737 60,569 Listing Fees 140,768 15,000 Communication 1,262,340 380,306 Advertisement 568,315 49,160 Travelling and conveyance 2,784,145 81,460 Printing and stationery 313,821 109,947 Sales commission 74,460 91,288 Balance written off 496,425 -16,073 Bad debts 366,347 - Business promotion 2,647,562 72,413 Legal and professional 2,128,508 2,491,195 Payments to auditors (Refer Note (i) below) 134,200 50,000 Net loss on foreign currency transactions and translation 63,763 51,316 Prior period items (net) # (Refer Note (ii) below) 25,059 - Miscellaneous expenses 319,937 218,242 Total 33,812,273 8,007,582

Note 18 Other expenses (contd.)



Amount in INR Amount in INR (i) Payments to the auditors comprises (net of service tax input

credit, where applicable):As auditors - statutory audit 100,000 35,000 For taxation matters 25,000 15,000 Reimbursement of expenses 9,200 - Total 134,200 50,000

(ii) Details of Prior period items (net)Prior period expenses Communication expense 5063Electricity expense 13594Telephone expense 2651Performance Incentive 3750 25,059 -

Total 25,059 -


30

Notes forming part of the financial statements1 Corporate information Virtualsoft Systems limited is a listed company (BSE) and having the presence in USA, U.K. Singapore and

India. The vision of the company is to empower business and learning communities with rich “knowledge-on-demand”. Company is engaged in: Pioneering Broadband, Virtual Event & Providing Mobile Roaming Services & Solutions.

The Registered office of the company is:- S-101, Panchsheel Park, New Delhi-110017 & Currently operates from B-236 Okhala phase -II New Delhi- 110020

2 Significant accounting policies

2.1 Basis of accounting and preparation of financial statements The financial statements of the Company have been prepared in accordance with the Generally Accepted

Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous year.

2.2 Use of estimates The preparation of the financial statements in conformity with Indian GAAP requires the Management

to make estimates and assumptions considered in the reported amounts of assets and liabilities (including contingent liabilities) and the reported income and expenses during the year. The Management believes that the estimates used in preparation of the financial statements are prudent and reasonable. Future results could differ due to these estimates and the differences between the actual results and the estimates are recognised in the periods in which the results are known / materialise.

2.3 Inventories Inventories are valued at the lower of cost (on FIFO / weighted average basis) and the net realisable value

after providing for obsolescence and other losses, where considered necessary. Cost includes all charges in bringing the goods to the point of sale, including octroi and other levies, transit insurance and receiving charges. Work-in-progress and finished goods include appropriate proportion of overheads and, where applicable, excise duty.

2.4 Cash and cash equivalents (for purposes of Cash Flow Statement) Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances

(with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

2.5 Cash flow statement Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax

is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

2.6 Depreciation and amortisation Depreciation has been provided on the straight-line method as per the rates prescribed in Schedule XIV to the

Companies Act, 1956 except in respect of the following :

Assets costing less than ` 5,000 each are fully depreciated in the year of capitalisation.


31

Intangible assets are amortised over their estimated useful life as follows:

Trade mark– 10 years The estimated useful life of the intangible assets and the amortisation period are reviewed at the end of each

financial year and the amortisation method is revised to reflect the changed pattern.

2.7 Revenue recognition

Sale of goods Sales are recognised, net of returns and trade discounts, on transfer of significant risks and rewards of

ownership to the buyer, which generally coincides with the delivery of goods to customers. Sales include excise duty but exclude sales tax and value added tax.

Income from services "Revenues from contracts priced on a time and material basis are recognised when services are rendered and

related costs are incurred."

2.8 Tangible fixed assets "Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The cost of

fixed assets includes interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Exchange differences arising on restatement / settlement of long-term foreign currency borrowings relating to acquisition of depreciable fixed assets are adjusted to the cost of the respective assets and depreciated over the remaining useful life of such assets. Machinery spares which can be used only in connection with an item of fixed asset and whose use is expected to be irregular are capitalised and depreciated over the useful life of the principal item of the relevant assets. Subsequent expenditure relating to fixed assets is capitalised only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance."

2.9 Intangible assets "Intangible assets are carried at cost less accumulated amortisation and impairment losses, if any. The cost of

an intangible asset comprises its purchase price, including any import duties and other taxes (other than those subsequently recoverable from the taxing authorities), and any directly attributable expenditure on making the asset ready for its intended use and net of any trade discounts and rebates. Subsequent expenditure on an intangible asset after its purchase / completion is recognised as an expense when incurred unless it is probable that such expenditure will enable the asset to generate future economic benefits in excess of its originally assessed standards of performance and such expenditure can be measured and attributed to the asset reliably, in which case such expenditure is added to the cost of the asset."

2.10 Foreign currency transactions and translations

Initial recognition Transactions in foreign currencies entered into by the Company at the exchange rates prevailing on the date

of the transaction or at rates that closely approximate the rate at the date of the transaction.

Measurement of foreign currency monetary items at the Balance Sheet date "Foreign currency monetary items (other than derivative contracts) of the Company outstanding at the Balance

Sheet date are restated at the year-end rates."

Treatment of exchange differences "Exchange differences arising on settlement / restatement of short-term foreign currency monetary assets

and liabilities of the Company and its integral foreign operations are recognised as income or expense in the Statement of Profit and Loss."


32

2.11 Employee benefits Employee benefits include provident fund, superannuation fund, gratuity fund, compensated absences, long

service awards and post-employment medical benefits.

Definedcontributionplans The Company's contribution to provident fund and superannuation fund are considered as defined contribution

plans and are charged as an expense as they fall due based on the amount of contribution required to be made.

Short-termemployeebenefits "The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services

rendered by employees are recognised during the year when the employees render the service. These benefits include performance incentive and compensated absences which are expected to occur within twelve months after the end of the period in which the employee renders the related service. The cost of such compensated absences is accounted as under :(a) in case of accumulated compensated absences, when employees render the services that increase their

entitlement of future compensated absences; and

(b) in case of non-accumulating compensated absences, when the absences occur."

Long-termemployeebenefits Compensated absences which are not expected to occur within twelve months after the end of the period

in which the employee renders the related service are recognised as a liability at the present value of the defined benefit obligation as at the Balance Sheet date less the fair value of the plan assets out of which the obligations are expected to be settled. Long Service Awards are recognised as a liability at the present value of the defined benefit obligation as at the Balance Sheet date.

2.12 Segment reporting The Company identifies primary segments based on the dominant source, nature of risks and returns and

the internal organisation and management structure. The operating segments are the segments for which separate financial information is available and for which operating profit/loss amounts are evaluated regularly by the executive Management in deciding how to allocate resources and in assessing performance.

"The accounting policies adopted for segment reporting are in line with the accounting policies of the Company. Segment revenue, segment expenses, segment assets and segment liabilities have been identified to segments on the basis of their relationship to the operating activities of the segment."

2.13 Earnings per share Basic earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of

extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential dilutive equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented. The number of equity shares and potentially dilutive equity shares are adjusted for share splits / reverse share splits and bonus shares, as appropriate.


33

2.14 Taxes on income "Current tax is the amount of tax payable on the taxable income for the year as determined in accordance with

the provisions of the Income Tax Act, 1961." Current and deferred tax relating to items directly recognised in equity are recognised in equity and not in the

Statement of Profit and Loss.

2.15 Provisions and contingencies A provision is recognised when the Company has a present obligation as a result of past events and it is

probable that an outflow of resources will be required to settle the obligation in respect of which a reliable estimate can be made. Provisions (excluding retirement benefits) are not discounted to their present value and are determined based on the best estimate required to settle the obligation at the Balance Sheet date, if any. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates. Contingent liabilities are disclosed in the Notes.

2.16 Service tax input credit Service tax input credit is accounted for in the books in the period in which the underlying service received is

accounted and when there is no uncertainty in availing / utilising the credits.

3 Notes to Accounts (Continued)

3.1 Capital WIP: The company is developing a software called CRM for providing telecom services. The expenses of Rs. 75,23,589/-incurred during the year has been capitalized . The management is of the opinion that since the process is still going on no amortization is required during this year.

3.2 Deffered Tax No Deferred tax asset has been recognized and carried forward in the Balance Sheet in view of the fact that

there exits no virtual certainty supported by convincing evidence that there will be available sufficient future profits against which such deferred tax asset can be adjusted.

3.3 Contingent Liabilities:

There are No Contingent liabilities during the year.

3.4 Balances of Sundry Debtors & Creditors and Loans and Advances appearing as at the year-end are subject to confirmation and reconciliation, if any.

3.5 As at year end, there was no amount due to any small scale industrial undertaking.

3.6 Previous Year Figures have been reclassified and regrouped, wherever necessary to conform to the current year’s classifications.

3.7 Figures are rounded off to nearest rupee.

3.8 14. Unclaimed Dividend Pursuant to section 205C of the companies act1956, dividends that are unpaid / unclaimed for a period

of seven years or more from the date they become due for payment are required to be transferred to the Investors Education and Protection Fund (IEPF) administered by the central government. The following unpaid / unclaimed dividends have not been transferred to IEPF A/C.

Unpaid Dividend Amount1997-98 438501996-97 27390


34

Note 20 Additional information to the financial statements

20.1 Share application money pending allotment

As at 31 March 2012, the Company has received an amount of ` 36,50,000/-towards share application money towards equity Shares of the Company (As at 31 March, 2011 ` 32,50,000/- towards equity shares). The Company has sufficient authorised capital to cover the allotment of these shares. Pending allotment of shares, the amounts are maintained in a designated bank account and is not available for use by the Company.

The year-end foreign currency exposures that have not been hedged by a derivative instrument or other-wise are given below:

As at 31 March, 2012 As at 31 March, 2011

Receivable/(Payable)

Receivable/ (Payable)in Foreign currency

Receivable/(Payable)

Receivable/ (Payable)in Foreign currency

` (indicate amount with currency)

` (indicate amount with currency)

760,597/- USD- 14868.06

(12,27,654/-) USD- 23998.02 (40872.63/-) USD-1032.67




20.2 Expenditure in foreign currency #:

Purchase 9,821,169 2,710,946

20.3 Earnings in foreign exchange @@:

Other income 996,238 -

Note 21 Disclosures under Accounting Standard -15

1 Employee benefit plans

Definedcontributionplans

The Company makes Provident Fund and Superannuation Fund contributions to defined contribution plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised ` 10,632/- , for the Year ended 31 March, 2012 & ` 44,588/-, for the previous year as Provident Fund contributions in the statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes

Definedbenefitplans

The Company offers the following employee benefit schemes to its employees:

i. Gratuity

ii. Leave encashment


35

Note 22 Disclosures under Accounting Standards (contd.)

1 Segment information

The Company has identified business segments as its primary segment and geographic segments as its secondary segment. Business segments are primarily Event Management Services and SIM Cards. Revenues and expenses directly attributable to segments are reported under each reportable segment. Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment and manpower efforts. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable. Fixed assets that are used interchangeably amongst segments are not allocated to primary and secondary segments. Geographical revenues are allocated based on the location of the customer. Geographic segments of the Company are India only.


Business segments Eliminations Total

Event Management

Services

SIM Cards

Amount in INR Amount in INR Amount in INR Amount in INR

Revenue 31,837,239.06 12,972,187.04 - 44,809,426.10

(8,858,184.00) (3,985,609.00) - (12,843,793.00)

Total 31,837,239.06 12,972,187.04 - 44,809,426.10

(8,858,184.00) (3,707,607.00) - (12,843,793)

Segment result 3,712,477.00 (15,225,328.00) - (11,510,351.00)

(621,435) (331,000) - (290,435.00 )

Operating income 44,809,426.10

(12,843,793.00)

Profit before taxes (11,510,351.00)

(290,435.00)

Net profit for the year (11,510,351.00)

(290,435.00)


36


Business segments Total

Event Management

Services

SIM Cards

Amount in INR Amount in INR Amount in INR

Segment assets 13,495,877.65 8,689,575.00 22,185,452.65

(12,869,903.00) (2,559,824.00) (15,430,046.00)

Total assets 22,185,452.65

(15,430,046.00)

Segment liabilities 74,690,302.73 29,744,779.27 104,435,082.00

(70,802,042.00) (8,243,694.00) (79,045,736.00)

Total liabilities 104,435,082.00

(79,045,736.00)

Other information

Capital expenditure (allocable) 2,471,334.00 15,808,266.30 18,279,600.30

(2,471,334.00) (8,284,677.30) (1,0756,011.30)

Depreciation and amortisation (allocable) 3,899,038.00 255,177.00 4,154,215.00

(32,929,344.00) - (32,929,344.00)


The geographic segments individually contributing 10 percent or more of the Company’s revenues and segment assets are shown separately:

Geographic Segment Results For the year

ended 31 March, 2012

Segment assets As at

31 March, 2012

Capital expenditure

incurred during the year ended 31 March, 2012

Revenue Earned during the year

Amount in INR Amount in INR Amount in INR Amount in INR

India (11,510,351.00 ) 22,185,452.65 18,279,600.30 44,809,426.10

(290,435.00) (15,430,046.00) (10,756,011.00) (12,843,793.00)


37

Note 23 Disclosures under Accounting Standard-18

Note Particulars1 Related party transactions

Details of related parties:Description of relationship Names of related parties

Holding Company Virtual Software & Training Private limitedKey Management Personnel (KMP) Mr. Gokul Tandon,Mr. Rajendra V Kulkarni, Mr.

Suresh Rajpal & Ashok k. AnandCompany in which KMP / Relatives of KMP can exercise significant influence

1.M.R. Capital Private limited

2.Foundation Technologies Private Limited3.Marble Arch Estates Private Limited4.Mountain Valley Springs Private LimitedElectronic Tender.com(India) pvt.ltd.6. Vijaya Stampings Private Limited7.Gotocustomer.Com Private Limited8.CPM India Sales & Marketing Private Limited9.Visnova Solutions pvt.Ltd.10.Gisil Design Pvt.Ltd.11.Inde Pay networksPvt.Ltd.12.Navis EximPvt.Ltd.13. Multiple Zone India Private Limited14. V Reach Solutions Private Limited15.Cosmo Films Ltd.16.Visnova InteractivePvt.ltd17.Inde Livelihood Foundation18.Office Zone products Pvt.Ltd.19.First Choice Graphics Pvt.Ltd.20.Inprint Marketing Pvt.Ltd.21.Inprint Expotech Pvt Ltd.23.Inprint Exclisives India Pvt.Ltd.24.SourceGraphics India Pvt.Ltd.25.M R Towers Pvt.Ltd.26.Prime Valves India Ltd.27.Veerana Estates Pvt. Ltd.28.MZI Services India Private Limited29.SME Business Services ltd.30.Roam1 Telecom Limited31.Techsure On-Line Services Pvt.Ltd.32.Digitivate Solutions Pvt.Ltd

Note: Related parties have been identified by the Management.


38

Details of related party transactions during the year ended 31 March, 2012 and balances outstanding as at 31 March, 2012:

23.2 Holding Company

KMP Entities in which KMP / relatives of KMP have significant influence

Total

Rendering of services - - 29,034 29,034

- - - -

Receiving of services - - 1,875,174 1,875,174

800,000 120,000 663,698 1,583,698

Finance (including loans ) - 23,196,877 - 23,196,877

500,000 6,745,160 - 7,245,160

Loans and advances given/(Re-paid)

800,000 2,251,000 - 3,051,000

(30,000) (1,795,618) - (1,825,618)

Balances outstanding at the end of the year

Loans and advances given 840,055 - 174,217 1,014,272

- - - -

Trade payables - - 374,039 374,039

Investment made 499,940

Borrowings 81,333,158 6,190,488 87,523,646


39

Note 24 Disclosures under Accounting Standard-20



Amount in INR Amount in INR 24.a Earnings per share

Basic24.b Continuing operations

Net profit / (loss) for the year from continuing operations (11,510,351.41) 290,435.00 Less: Preference dividend and tax thereon - - Net profit / (loss) for the year from continuing operations attributable to the equity shareholders

(11,510,351.41) 290,435.00

Weighted average number of equity shares 7,547,600.00 7,547,600.00 Par value per share 10.00 10.00 Earnings per share from continuing operations - Basic (1.53) 0.04

24.c Total operationsNet profit / (loss) for the year (11,510,351.41) 290,435.00 Less: Preference dividend and tax thereon - - Net profit / (loss) for the year attributable to the equity shareholders

(11,510,351.41) 290,435.00

Weighted average number of equity shares 7,547,600.00 7,547,600.00 Par value per share 10.00 10.00 Earnings per share - Basic (1.53) 0.04 Basic (excluding extraordinary items)

24.d Continuing operationsNet profit / (loss) for the year from continuing operations (11,510,351.41) 290,435.00 (Add) / Less: Extraordinary items (net of tax) relating to continuing operations

- -

Less: Preference dividend and tax thereon - - Net profit / (loss) for the year from continuing operations attributable to the equity shareholders, excluding extraordinary items

(11,510,351.41) 290,435.00

Weighted average number of equity shares 7,547,600.00 7,547,600.00 Par value per share 10.00 10.00 Earnings per share from continuing operations, excluding extraordinary items - Basic

(1.53) 0.04

24.e Total operationsNet profit / (loss) for the year (11,510,351.41) 290,435.00 (Add) / Less: Extraordinary items (net of tax) - - Less: Preference dividend and tax thereon - - Net profit / (loss) for the year attributable to the equity shareholders, excluding extraordinary items

(11,510,351.41) 290,435.00

Weighted average number of equity shares 7,547,600.00 7,547,600.00 Par value per share 10.00 10.00 Earnings per share, excluding extraordinary items - Basic

(1.53) 0.04


40



Amount in INR Amount in INR DilutedThe diluted earnings per share has been computed by dividing the Net Profit After Tax available for Equity Shareholders by the weighted average number of equity shares, after giving dilutive effect of the outstanding Warrants, Stock Options and Convertible bonds for the respective periods. Since, the effect of the conversion of Preference shares was anti-dilutive, it has been ignored.

24.f Continuing operationsNet profit / (loss) for the year from continuing operations (11,510,351.41) 290,435.00 Less: Preference dividend and tax thereon - - Net profit / (loss) for the year attributable to the equity shareholders from continuing operations

(11,510,351.41) 290,435.00

Add: Interest expense and exchange fluctuation on convertible bonds (net)

- -

Profit / (loss) attributable to equity shareholders from continuing operations (on dilution)

(11,510,351.41) 290,435.00

Weighted average number of equity shares for Basic EPS

7,547,600.00 7,547,600.00

Add: Effect of warrants, ESOPs and Convertible bonds which are dilutive

- -

Weighted average number of equity shares - for diluted EPS

7,547,600.00 7,547,600.00

Par value per share 10.00 10.00 Earnings per share, from continuing operations - Diluted (1.53) 0.04


24.g Total operationsNet profit / (loss) for the year (11,510,351.41) 290,435 Less: Preference dividend and tax thereon - - Net profit / (loss) for the year attributable to the equity shareholders

(11,510,351.41) 290,435


- -

Profit / (loss) attributable to equity shareholders (on dilution)

(11,510,351.41) 290,435


7,547,600 7,547,600

Add: Effect of Warrants, ESOPs and Convertible bonds which are dilutive

- -


7,547,600 7,547,600

Par value per share 10 10 Earnings per share - Diluted (1.53) 0.04

Diluted (excluding extraordinary items)


41



Amount in INR Amount in INR Net profit / (loss) for the year from continuing operations (11,510,351.41) 290,435 (Add) / Less: Extraordinary items (net of tax) - - Less: Preference dividend and tax thereon - - Net profit / (loss) for the year from continuing operations attributable to the equity shareholders, excluding extraordinary items

(11,510,351.41) 290,435


- -

Profit / (loss) from continuing operations attributable to equity shareholders (on dilution)

(11,510,351.41) 290,435


7,547,600 7,547,600


- -

Weighted average number of equity shares- for diluted EPS

7,547,600 7,547,600

Par value per share 10 10 Earnings per share, from continuing operations, excluding extraordinary items - Diluted

(1.53) 0.04

24.i Total operationsNet profit / (loss) for the year (11,510,351.41) 290,435 (Add) / Less: Extraordinary items (net of tax) - - Less: Preference dividend and tax thereon - - Net profit / (loss) for the year attributable to the equity shareholders, excluding extraordinary items

(11,510,351.41) 290,435


- -

Profit / (loss) attributable to equity shareholders (on dilution)

(11,510,351.41) 290,435


7,547,600 7,547,600


- -


7,547,600 7,547,600

Par value per share 10 10 Earnings per share, excluding extraordinary items - Diluted

(1.53) 0.04


VIRTUALSOFT SYSTEMS LIMITEDRegistered Office : S-101, Panchsheel Park, New Delhi-110 017

PROXY FORM

I/we .................................................................................. resident of .............................................................................

being a Member/s of VirtualSoft System Ltd. hereby appoint Mr./Mrs./Miss ............................................................

......................................................................................... resident of .............................................................................

or failing him/her Mr./Mrs./Miss .....................................................................................................................................

resident of ........................................................................................................................................................................

Vote for me/us on my/our behalf at the Annual General Meeting of the Company to be held on Friday the 28th September 2012 at 9:00 A.M. at Rama Krishna Banquets Hall, Near Main Market, Bhajanpura, Main Wazirabad Road, Delhi –110 053, and at any adjournment thereof.

Signed this .......................... day of .................................. 2012

(Signature of the Shareholder)

Note :

1. The Proxy need not be a member of the Company.2. The Proxy Form duly Signed across Rs. 1/- Revenue Stamp should reach the compnay’s Registered Office,

at least 48 hours before the Meeting.

VIRTUALSOFT SYSTEMS LIMITEDRegistered Office : S-101, Panchsheel Park, New Delhi-110 017

ATTENDANCE SLIPAnnual General Meeting—28th September 2012

I/We hereby record my/our presence at the Annual General Meeting of the Company at Rama Krishna Banquets Hall, Near Main Market, Bhajanpura, Main Wazirabad Road, Delhi –110 053,on Friday the 28th September 2012 at 9:00 A.M.

Name Father’s/Husband’s/Company Representative Name

Signature

L.F. No.

L.F. No.

No. Of Shares Held

DP ID No.

DP ID No.

Client ID No.

Client ID No.

AffixRupee OneRevenueStamp

No gift of any nature will be distributed at the Annual General Meeting. The members seeking gifts may excuse us.

virtual soft virtualsoft systems limited2. the register of members and share transfer books of the...

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